Wellwishers outside Nelson Mandela's home in Johannesburg on his birthday last month. Photograph: Reuters

Having spent 27 years in jail, brought down racial apartheid and been elected South Africa's first black president, Nelson Mandela, and critically ill in hospital, might have expected city council bureaucrats to cut him a little slack.

Yet a notice attached to the 95-year-old's Johannesburg home at the weekend warned that he owed 6,468.48 rand (£430) in unpaid bills and risked being cut off and prosecuted in court.

Before bailiffs could loom at his bedside, however, officials admitted they had made a terrible mistake and had sent the pre-termination notice to the wrong address. They apologised to the Mandela family and promised to discipline those responsible.

On Monday, all was quiet at the Mandela residence in the upmarket suburb of Houghton, where drawings and painted messages of support for the ailing hero were still visible. The debt notice from Johannesburg city council's credit control department had been removed.

Dated 1 August and addressed to 49 Fourth Street in Oaklands, the notice said the occupier's account had been 6,468.48 rand in arrears for more than 30 days and payment was required within two weeks.

"Failure to do so may, without any further notice to yourself, result in the following actions: Discontinuation or restriction of services and/ or legal action being instituted against yourself without any further notice," it said.

In bold, underlined text, the letter added: "Take note: We will not be held liable for any damages or claims as result of water restrictions/terminations as determined by legislation."

Such action would have been an ignominious final skirmish with the law for a man who set up South Africa's first black legal practice and was among the accused at the Rivonia trial half a century ago.

Officials confirmed it was a mistake and apologised. "The city of Johannesburg confirms that the pre-termination notice which was sent to the Mandela residence was incorrectly delivered," said Kgamanyane Maphologela, acting director of customer communications at the revenue shared services centre.

"The address and account number stated on the notice belongs to another customer and property in a neighbouring suburb, not to the Mandela residence.

"The city wants to convey an apology to the Mandela family for any inconvenience caused by this unfortunate incident. City officials have been sent to the Mandela family and Children's Foundation to apologise for the embarrassment to the family.

"While a full investigation is being conducted as to how this error occurred, the city has decided to take action against people involved."

Billing problems are a common bugbear of Johannesburg residents and often feature in newspaper consumer advice columns.

Maphologela said: "Currently customer data is being cleansed and updated and therefore, occasional errors like this may occur. We wish to apologise to any customer who might have had a similar experience."

Mandela has been in hospital in Pretoria since 8 June and remains in a critical condition, but is said by officials and family to be slowly improving.